Nonferrous Scrap Supplement -- Welcome

Now You See It, Now You Don't

If anyone in the recycling industry needed further convincing that there are no sure things, the past year has probably provided final proof.

One year ago, the aluminum industry seemed poised to build on its gains in the automotive market, and the only question seemed to be whether there would be enough aluminum scrap available to feed hungry furnaces and smelters.

Similarly, dealers of stainless steel scrap were hearing confident reports about demand for stainless steel in new and growing applications. As with aluminum, procuring the necessary feedstock seemed like the only challenge.

But along came an industrial slowdown sweeping enough to turn the heat down to a low boil, along with an energy crisis that has snuffed out some furnaces entirely.

Slowing industrial production has hit most metals industry sectors equally. Fortunately, most companies in the once high-flying aluminum industry have been able to withstand the downturn better than many steel companies, who were fighting to stay in the black even during the good times.

But the once profitable segment has watched much of the black ink disappear, as a combination of decreased orders and wildly inflated energy costs has turned the black ink into red almost magically.

For recyclers, the energy crisis in particular is an intriguing development. While they too can be stung by higher power costs, the advantages of recycling nonferrous metals as opposed to smelting mined materials become all the clearer when energy costs rise.

When markets rebound, recyclers like to think that they will be poised to take advantage of a wide market of scrap consumers eager to keep their furnaces charged with recycled feedstock.

In the meantime, nonferrous recyclers and scrap consumers are trying to operate as wisely as possible in difficult times. We are pleased to present a variety of articles in this year’s Nonferrous Scrap Supplement that can help recyclers gain insight into market forces that are affecting the supply, demand and pricing of the nonferrous metals they handle.